Corporate Auditing Report: Woodside Petroleum Ltd Analysis

This report, prepared for a Corporate Auditing assignment, delves into the intricacies of material misstatements within the context of financial auditing. The report begins by addressing the risk of material misstatement, emphasizing the roles of the auditor, management, and government in mitigating these risks, with specific reference to ASA 240. It explores the auditor's responsibilities, the importance of professional skepticism, and the significance of discussions among the engagement team. The report then analyzes the audit planning process, using the 2016 annual report of Woodside Petroleum Limited as a case study. It identifies key business risks faced by the company, including economic, operational, taxation, and reputational risks, and evaluates the financial performance based on horizontal analysis and ratio analysis. Furthermore, the report provides examples of material misstatement cases, such as the Enron and Bernie Madoff scandals, to illustrate the real-world impact of these issues. The report concludes by synthesizing these elements to offer a comprehensive understanding of corporate auditing practices and challenges.

Running head: CORPORATE AUDITING
Corporate auditing
Name of the student
Name of the university
Authors note

1
CORPORATE AUDITING
Table of Contents
Part 1..............................................................................................................................2
Answer to question 1..................................................................................................2
Part 2..............................................................................................................................7
Answer to question 2..................................................................................................7
References....................................................................................................................13

2
CORPORATE AUDITING
Part 1
Answer to question 1
To miss Williams
Subject: risk of material misstatement
Respected madam
In order to solve your query over the issue related to the issue of material
misstatement it can be said that the company audit report is fully based on the role of the
company auditor and government. Hence as per my view the company auditing standards
have been determined as per ASA 240 of the risk management of the potential investor are
very much significant to the case and the same is used to detect the fraud and related material
misstatement. Hence the material misstatement is expected to be higher than the actual risk
statement. However the failure to this could be relating to material misstatement. Hence the
company auditor concealment will be very difficult to judge in this case and thus it is
important to explain the management responsibility towards the government and auditor.
Auditor
The topic is related to the risk of material misstatement may be misled due to the
fraud detection and the same includes the nature, expert and frequency of the assessment.
Hence it is seen that the management process is related to the best possible risk
identification responding to the frauds and misstatements or the same have been brought to
attention to the higher management or the authority.
The management communication could be distracted if the government had likely
failed to identify the risk.

3
CORPORATE AUDITING
The management communication is related to the overall management exposure
towards the best ethical practises.
It is suspected that the company auditor and the management to see whether the
knowledge base is for real and whether there is any suspicious and alleged fraud have been
conducted. Thus the same could affect the management.
The internal audit process will be effective to determine to see the actual knowledge
of the individual or the suspected fraud is affecting the country or not (Puat Nelson and Devi
2013).
Governance
The government is also a major concern who are directly associated with the entity. Hence it
is important to look after the management risk process by identifying the possible risk source
and mitigate the same. Unless any big expected change to occur, it is important that the
management must determine the fraudulence of the entity. Thus there lies some basic
difference between the identification of fraud and to choose the possible risk factor between
the scenarios (Bruynseels and Cardinaels 2013).
Misrepresentation of the auditor role
The auditor conception and the roles and responsibilities are considered as a big issue.
Hence the auditor while conducting the audit as per standard could look to obtain the
reasonable assurance if the financial reports is considered by the material misstatement is
considered as a big error or fraud. Hence the audit limitation risk is gene rally used to convey
the material misstatement on the company financial report which is to be deducted and had
been managed by the auditing standard of Australia. Hence the basic limitation are
significant to the process. Thus the overall risks are to be detected than the risk inheritance.
The process is sophisticated and being properly used towards the organisation to conceal it.

4
CORPORATE AUDITING
The overall fraud detection is used to chalk out the basic errors. Hence as per the ASA 200
potential reporting source the overall limitations are been cleared properly. Thu the auditor
misconception is very much related to the amounts placed and promoted. On the further note
it can be said that the obtained and assured risk management matrix are very much
responsible to this case. On the other hand it is important for the company auditors to identify
and manage the best possible risks related aspects as well as look to mitigate the risk as a
whole (Cohen et al. 2013.).
Risk Factor related to the material misstatement
The material misstatements are considered as an important area for ASA 240. Thus the
company auditor it is important to the company auditor to seek and assess the best possible
risks factors for the material misstatement. Thus it is important to have proper audit process
identified and to dispose the fraud factors. Thus there are many reasons to be considered in
this case at the time of recognising the basic risk related factors over the revenue recognition.
Professional scepticism
As per the ASA 240 standard it can be said that the company auditors need to
maintain the professional scepticism by the audit report and it is expected that the same could
be useful to stop the emerging material misstatement, thus the company auditor could be
charged towards the honesty and integrity over the early management process.
Unless there is a chance of contradiction the company auditor is expected to consider
the audit report in general. The process is suspected to audit report and to make the
investigation a bit more useful to this aspect. Thus it is said that the ASA 240 aspect is very
much effective to find the audit fraudulence. Thus the company auditor have gone for the
further investigation if the process is used for the further investigation.

5
CORPORATE AUDITING
Discussions among the engagement team
As per the ASA 315 article there is a discussion needed here from the management
and responsibility is at all useful for the communication and discussion forum. Thus it can be
said that the particular process could be laying emphasis over the company financial report.
Thus the major focused area will be considered as fraudulence. The discussion team will be
able to engage with the team members. Similarly the Woodside petroleum limited will be
playing an important role for the management and the factors which are related to materiality
will be a considered as a major concern over here which is usually facing the material
misstatement.
Risk assessment process and related activities
The material misstatement process is very much important to the understand the
overall value and engagement related to the Internal audit control as per ASA 315. The
material misstatement process is detected to the fraudulance. Similarly for the case of
Woodside petroleum limited the overall assessment procedure and the fraud related aspects
are determined.
Examples related to the, material misstatement
It can be said that the material misstatement is an active topic and throughout the
decade many active cases have been prepared in this case to make the most out of this theory.
Thus the same theory have been reported in the media.
The Enron scandal (2001)
The Enron scandal happens to the one of the actively scandals that have occurred in
the process at the year 2001. It is seen from the aspect that the company had been using the

6
CORPORATE AUDITING
accounting loopholes which had initially affected the profitability of the company. Hence it
had been seen that the company had lost a money near about $74 billion as well as the price
of the company had fallen drastically. The company share price had fallen from $90 to $1
within a year. Overall there had been a loss of 20000 employees who had lost job.
Bernie Madoff scandal (2002)
This scandal had reported in the year. Bernie had been a stock broker and had a Ponzi
shop. He had tricked an amount of $64.8 billion dollar. Hence he had been sentenced to 150
years of prison and compensated $170 billion.
Thank you.

7
CORPORATE AUDITING
Part 2
Answer to question 2
Audit planning memorandum
Project number……………..
Project name…………………
Prepared by……….. Date………..
Received by……… time………….
From the annual report of the Woodside petroleum limited in the year 2016 the
company had initially focused on the reduction of the threat and had also focused to the
adverse impact over the changes of results or the outcome of the value chain analysis. Hence
the process have not been implemented of some differential criteria in order to evaluate the
material risk statements across the company. Hence the process tells about the systematic
risks status and the exposure to assess the overall risks status of the force like the
environment, finance, reputation and the brand recognition. Thus the process is very much
related to the overall risk management.
Thus it can be said that the company had identified basically four types of business
risk in the process which are basically known as economic risk , operational risk, taxation
risk and reputational risk. The economic risk is fully associated to the company economic
status and performance. Thus to the due economic risk is properly meet with the market
research and the overall risk status. Hence it is seen that the overall consequence are related
to the reduction had imposed an overall impact over the profitability on the company annual
report. On the other hand to explain the overall reputational risk it is need to imply the risk of
capital structure, exploration and the capital acquisition report. The capital expenditure

8
CORPORATE AUDITING
report had been also increased over the period. Next to consider is the Australian tax risk in
the petroleum industry. Hence the petroleum industry had been facing some litigation of the
Australian government which had hampered the overall finance industry. Apart from this
there is the utilisation to the successful use and mantainence of the upstream resources as a
whole. The company had initially failed to launch the hydrocarbon by selecting a suboptimal
developmental option as a whole. Thus due to the change of this process it can be said that
the execution of the project had stopped which could be looking as an attractive for the
overall cost structure, quality and to schedule expectation and can look to imply the impact
on the organisation. Hence the sustainable and the unplanned interruption of the production
and the impact of the licence to operate and to make the financial performance. Hence the
change in the operational facilities have been implied to the inclement weather and the supply
chain management disruption. Hence the process had resulted to the loss of hydrocarbon
emission, distinguished choices to make and the overall productions cost as well as the
unintentional disruption or certain economic disruption. Thus it can be said that the chemical
value is to be changed behind the global change in the Woodside control. Hence the change
in the overall demand and the price of the control to remain the process useful. Hence the
factors could be included to the basic changed process and the new and implied policies
related to the price change. Hence it can be said that the overall political and the economic
change have been implied to the commercial transaction change. Hence it can be said that the
basic calculated data have been provided through the use of the horizontal data. Thus the
calculation is targeted at 4 percent to the initial value related to the calculation. The potential
assets are fully been reduced to the process (Bhasin 2016). Hence from the calculation it is
seen that the current liabilities have been decreased by 26 percent. The debt and the residual
value had been used in order to reduce the liability. On the other hand the net assets have
been seen to be increased to 4 percent since the net assets have helped to realise the net

9
CORPORATE AUDITING
revenue in the basis of the horizontal analysis. Thus the revenue valuation is likely to be
decreased during the time. On the other hand the net revenue is also likely to change during
the case. The equity value is overall had been increased in the case to 4 percent also. The net
profit is used to be helpful to the company time to time since it had increased the price
overall. Apart from this there have been three types of ratios calculated in the case. Firstly the
current ratio is used to see the main utilisation of the current assets and the current liabilities
as a whole. It is seen that the current ratio value has been calculated at 0.9345 approx. the
general rate of the assets and the liabilities have been rated at 1;1. Hence as per this ratio it
can be interpreted that the company liquidity position have not been good as per the company
perspective. This calls for the change in the financial position as a whole. On the company
liquidity ratio is used to calculate the overall liquidity and the profitability of the company.
Hence it is seen that the liquidity ratio of the company had been decreased to less than
1which is 0.6970. Hence these changes are subjected to be less than the standard norm.
Hence this change calls for the urgent revaluation and some certain change. Lastly the
inventory turnover ratio is also calculated in this process. It can be said that the inventory
turnover ratio is very much useful to the process where it is seen that the value is calculated at
less than 1. Hence it is said that the company had not properly managed the financial report to
the company. Thus all the calculated values in the comprehensive statement analysis, balance
sheet and cash flow have shown the company’s financial structure as well as the overall
performance as a whole. On the other hand the trend analysis have been much volatile in the
financial year. Lastly the ratios calculated thereon have significantly imposed the call for
financial restructuring overall.
Thus it can be said that the company had identified basically four types of business
risk in the process which are basically known as strategic risk, operational risk, taxation risk
and exchange risk. The economic risk is fully associated to the company economic status and

10
CORPORATE AUDITING
performance. Hence the strategic risk can be assessed towards the management process and
the opportunities also increased over the period. On the other hand the company had been
abled to mitigate certain risk to the process. Hence it is seen that there had been some overall
disruption to the imposed tax rate and valuation. The tax disruption to the process is very
much validate to showcase the discount rate value of the operation. The discount value is
imitated towards the value. Thus after reducing the overall profit to the beginning of the year
the company in the first quarter had not been able to compromise the changed management
issue with respect to the overall change in the company production structure as a whole.
Hence with the effect of this change the overall performance of the company had likely to
decrease in the overall market structure and it is also expected that the oil prices is likely to
be increased during the point of time. On the other hand it is also seen that the risk
assessment is also been helpful to make and identify the overall changes used to put the
values together as well as the same could look to mitigate the risks status of the process. Thus
it is important to identify the process which is used to imply certain risk development
structure. Hence it is seen from the process that the basic change in the company cash flow
and the overall currency fluctuation is also important to use apply the current performance
structure as a whole. Therefore all these risks have been quite useful to draw the risk status of
the company performance in the financial performance. Therefore the risk status of the
process could be useful to the extent if the problems are properly sorted out overall. Hence to
value the limitations there are certain inherent risks which if had been properly fulfilled could
be a massive advantage in this case. Hence as per the process the basic limitation to the
process are as follows-
The US dollar reflects the best possible change of the Woodside Company which had
consider the possible inflow and the overall financial assets valuation process statement to

11
CORPORATE AUDITING
make the performance reporting standard. Hence the overall change could well be utilised to
reduce the overall exposure towards the currency fluctuations.
On the other hand the overall commercial exposure process which are used to design
and reduce the like hood of the risk variance which is used to materialised a result related to
the commercial perspective. On the other hand there is a change in the specific standard and
the approach to the company shareholders value as well as the objectives are likely to manage
and mitigate the risks structure as a whole (Jizi et al.2016).
It is also seen that the overall expected cost are likely to reduce as well as to generate
the basic advantage. Technologically these are some of the relevant solutions that are very
much useful to reduce the overall objectives. Thus the basic risk management process will be
very much useful in order to motivate the emergency trends and the disruptive value process
for the innovation and the technology.
On the other hand the basic footprint is said to be very much important In order to
strengthen the global framework and make the process to utilise the supporting tools and
details as well as the process have been implemented within the countries in which the
process have been operated along with the process .
The overall changes which have been shifted to the energy efficiency and the same
have been initially mentioned to the engagement with the company stakeholders and the same
process is useful to modify the climate change. Hence the same process is useful to the
process and the same outcome is useful in the opportunity to the company value and ideas.
The company have been exploring the new ideas where the transportation process is for fuel
and the value is useful to reduce the emissions and to improve the quality.
The fraud and the corruption control programme is useful and therefore there are
some added clear framework could look to make certain Incorporations to the policies,